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Supply Chain Issues Trigger Price Hikes, School Lunch Shortages, and More

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Many news outlets have cited experts warning of supply chain issues affecting holiday spending, but the consequences of ongoing bottlenecks are already being felt across the country.


Schools Struggle for Food 

A host of supply chain bottlenecks are affecting products and businesses throughout the U.S., forcing prices of goods and services to rise. 

In Colorado, the ​​Denver Public Schools system said it’s struggling to make sure it has enough milk for students on a daily basis, Insider reported Sunday. In fact, the schools are so short on milk cartons they’ve now resorted to asking students to bring refillable water bottles instead.

“When the milk is available, we are prioritizing serving milk at breakfast at all schools and at our elementary schools for lunch,” Theresa Hafner, DPS executive director of Food Services, told Insider in an email.

Meanwhile, other schools are struggling to find additional lunch-related supplies including meats, orange juice, meal trays, and plastic cutlery.

According to NBC News, Shonia Hall, director of school nutrition services for Oklahoma City Public Schools, even found herself needing to make a run to a local Sam’s Club to purchase 60,000 spoons and forks each just “to get us through for a few days in hopes the truck would show up.”

“It’s an additional cost to your budget, to your program,” she added.

Zillow Pauses House Buying

The issues also extend to the housing market, as both labor and supply shortages have led to operational backlogs for renovations and closings.

Zillow cited those issues Sunday when announcing that it would stop buying homes at least through December. Instead, the company said it plans to first prioritize the selling of its current catalog of homes. 

“We’re operating within a labor- and supply-constrained economy inside a competitive real estate market, especially in the construction, renovation and closing spaces,” Jeremy Wacksman, Zillow’s chief operating officer, said in a statement cited by Yahoo! Finance.

Zillow’s share price fell as much as 11% from around $94 to around $84 early Monday as investors pulled out of the company.  

What’s Causing the Issues?

U.S. companies are having a hard time stocking their shelves with certain products and keeping prices from rising largely because of factors induced by the pandemic.

The first and most basic issue is that last year, most consumer spending halted amid COVID-19 lockdowns in March. Around that same time, many companies were forced to scale back production and lay off workers.

However, more people are now returning to the outside world, and with that comes a boost in shopping. Still, several businesses have found themselves unable to ramp up production to meet the increased and arguably unprecedented demand.

In addition to production issues, there are numerous transportation challenges. For example, a large wave of businesses have struggled for months to fill open positions. One such industry where that’s being acutely felt is trucking.

In fact, the country is so stressed for drivers to haul freight that at least one high school in California has now launched a program to train seniors to drive big rigs

Meanwhile, Walmart, UPS, and FedEx all made 24/7 transportation commitments last week. 

The supply chains problems don’t stop with ground transportation. One of the most pressing situations seen so far involves the problems at the Ports of Los Angeles and Long Beach in California, where container ships are backed up. 

Pre-pandemic, it was fairly unusual for any cargo ship to be seen waiting off the coast to get into one of the two ports, which process 40% of all shipping containers entering the U.S. Now, dozens of ships have been waiting weeks to get in. 

Even once they unload, there’s another major backlog involving shipping containers at the ports. Because of those combined issues, Long Beach extended its operational hours in September.

President Joe Biden later announced on Oct. 13 that L.A.’s port will “operat[e] around the clock 24/7” as part of a “90-day sprint” to clear a path for cargo.

Supply chain issues are expected to impact holiday shoppers, but many analysts expect the problems to extend well into 2022. Transportation Secretary Pete Buttigieg echoed that prediction on Sunday during an appearance on CNN. 

See what others are saying: (NBC News) (Insider) (Wall Street Journal)

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New Federal Rules Allow Debt Collectors To DM People on Social Media

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Among several limitations, collectors cannot message people publicly, must state upfront that they’re pursuing a debt, and must give people an opportunity to opt-out of receiving additional messages through social media.


Debt Collectors Can Now DM

If you’ve suddenly found yourself flooded with more DMs in the last day, it might not be because you’ve become more popular. Instead, it could be because a new federal rule that went into effect Tuesday now allows debt collectors to message people by email, text, and even through direct messages on social media.

Debt collectors will still be subject to several notable limitations.

For example, if they reach out to someone on social media, it has to be through a private message. It can’t be in a public comments section or anything viewable to anyone except the recipient.

Additionally, if they attempt to reach out by adding a recipient as a friend or contact, they must be clear from the start that they’re pursuing a debt. 

Finally, collectors must allow recipients to opt-out of receiving further messages from them on the social media platform they reach out on. 

Collectors Praise the Rule, Others Express Concern

The new rule, which was greenlit by former Consumer Financial Protection Bureau Director Kathy Kraninger, has largely been met with praise throughout the collection industry. Kraninger, a Trump-appointee who vacated her office during President Joe Biden’s transition, has argued that the rule is intended to “modernize the legal regime for debt collection.”

Essentially, she and debt collectors have contended that texts, email, and social media are now the preferred methods of communication for many people in America.

Many others, particularly those outside the collection industry, are less happy with the new rule. 

“If left unchecked, this expanded access to consumers could very well contribute to new ways to harass struggling consumers,” Michelle Singletary of The Washington Post said.

“I’ve followed this issue for years, and while many companies operate within the law, illegal operations can do a lot of damage to innocent consumers,” she added. “Debt collection isn’t wicked. But it can lead to embarrassing, unethical and illegal tactics.”

For example, Singletary noted that some companies try to collect debts even after they’re no longer legally collectible. 

See what others are saying: (The Washington Post) (Business Insider) (CBS News)

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Workers in Alabama Will Rehold Vote to Unionize After Amazon Interfered With First Election, Agency Finds

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Among other actions, federal officials found that Amazon improperly placed an unmarked U.S. Postal Service mailbox in front of its warehouse.


Workers Will Redo Union Vote

Workers at an Amazon warehouse in Bessemer, Alabama, will revote on whether or not to unionize thanks to a ruling issued Monday by the National Labor Relations Board (NLRB).

The workers previously agreed not to unionize by a vote of 1,798 to 738 in April. Had they voted yes, the group would have set a precedent by becoming the first Amazon employees in the country to be represented by a union.

Following the initial vote, the Retail, Wholesale, and Department Store Union — which led the charge for employees to organize — filed unfair labor practices charges with the NLRB, an independent federal agency. There, it alleged that Amazon at times broke the law while campaigning against the effort. 

In its Monday decision, the NLRB’s Atlanta regional director Lisa Henderson agreed, saying Amazon, “essentially highjacked the process and gave a strong impression that it controlled the process.”

She additionally noted that Amazon “improperly polled employees when it presented small groups of employees with the open and observable choice to pick up or not pick up ‘Vote No’ paraphernalia in front of” managers.

Amazon Challenges NLRB Ruling

Amazon is expected to appeal Henderson’s decision. 

“It’s disappointing that the NLRB has now decided that those votes shouldn’t count. ​​As a company, we don’t think unions are the best answer for our employees,” spokesperson Kelly Nantel said according to NPR. 

In a statement, Nantel also cited the fact that the results of the first vote were overwhelming. 

Convincing employees to flip the results will likely be an uphill battle. To do so, those in favor of unionizing will need to convince hundreds to vote differently or convince thousands of workers who sat out the last round to now vote. 

Still, this is a second breath of life for pro-unionists. While some believe the outcome could change given high employee turnover rates at Amazon, many others expect it to hold firm as a “no” vote. 

See what others are saying: (NPR) (WVTM) (The Washington Post)

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CVS, Walgreens, and Walmart Helped Fuel the Opioid Crisis, Jury Finds

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While all three chains have vowed to appeal, this ruling is a massive win for plaintiffs who argued that opioid manufacturers and retailers violated “public nuisance” laws when contributing to the opioid epidemic.


Jury Sides Against Retailers

A federal jury in Cleveland agreed Tuesday that CVS Health, Walgreens, and Walmart — three of the country’s biggest pharmacy chains — are responsible for contributing to the opioid crisis in two Ohio counties.

This is the first time that the retail arm of the drug industry has been held accountable for opioid overdoses and deaths. It’s also the first time a jury has been used to decide in a major opioid lawsuit.

Previously, only manufacturers such as Purdue Pharma and Johnson & Johnson faced settlements or penalties, though the latter narrowly escaped $465 million in opioid fines in Oklahoma earlier this month after the state’s Supreme Court overturned a lower court ruling. 

Many plaintiffs in thousands of similar lawsuits all across the country are seeing the Ohio jury’s decision as an optimistic sign — especially since most of them are using the same argument. Plaintiffs in Ohio alleged that either opioid manufacturers or retailers violated “public nuisance” laws by ignoring harm caused by opioid abuse that later snowballed into a full-fledged public health crisis. 

Retailers Vow to Appeal

Unsurprisingly, all three chains have promised to appeal Tuesday’s verdict.

There is precedent to think this decision could be overturned. For example, the now-overturned J&J lawsuit first successfully used the public nuisance argument in lower courts, but during an appeal, the Oklahoma Supreme Court thought the plaintiff’s argument was too broad. 

That said, every state has different public nuisance laws, so there may not be a clear-cut answer as to what actually could happen with all these cases. 

Despite a pending appeal, the judge overseeing Tuesday’s Ohio verdict will make a determination on how much these companies must pay after additional hearings in the spring. 

While the retail arm has largely avoided settling up to this point, if this case ultimately does not go their way, it could open the door for future settlements if they decide that route is less costly than going to trial. 

See what others are saying: (The New York Times) (Associated Press) (The Wall Street Journal)

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